§ 4079. Group insurance policies; definitions

Group health insurance is hereby declared to be that form of health insurance covering one or more persons, with or without their dependents, and issued upon the following basis:

(1)(A) Under a policy issued to an employer, who shall be deemed the policyholder, insuring at least one employee of such employer, for the benefit of persons other than the employer. The term "employees," as used herein, shall be deemed to include the officers, managers, and employees of the employer, the partners, if the employer is a partnership, the officers, managers, and employees of subsidiary or affiliated corporations of a corporation employer, and the individual proprietors, partners, and employees of individuals and firms, the business of which is controlled by the insured employer through stock ownership, contract, or otherwise. The term "employer," as used herein, may be deemed to include any municipal or governmental corporation, unit, agency, or department thereof and the proper officers as such, of any unincorporated municipality or department thereof, as well as private individuals, partnerships, and corporations.

(B) In accordance with section 3368 of this title, an employer domiciled in another jurisdiction that has more than 25 certificate-holder employees whose principal worksite and domicile is in Vermont and that is defined as a large group in its own jurisdiction and under the Patient Protection and Affordable Care Act, Pub. L. No. 111-148, § 1304, as amended by the Health Care and Education Reconciliation Act of 2010, Pub. L. No. 111-152, may purchase insurance in the large group health insurance market for its Vermont-domiciled certificate-holder employees.

(2) A policy issued to an association, a trust, or one or more trustees of a fund established, created, or maintained for the benefit of members of one or more associations, or a contract or plan issued by such an association or trust, or by a multiple employer welfare arrangement as defined in the Employee Retirement Income Security Act of 1974, as amended. The association or associations:

(A) shall have a minimum of 100 persons at the time of incorporation or formation if it has been incorporated or formed outside this State, and a minimum of 25 persons at the time of incorporation or formation if it has been incorporated or formed in this State;

(B) shall have been organized and maintained in good faith for purposes other than that of obtaining insurance;

(C) shall have been in active existence for at least one year; and

(D) shall have a constitution and bylaws which provide that:

(i) the association or associations hold regular meetings not less than annually to further purposes of the members;

(ii) except for credit unions, the association or associations collect dues or solicit contributions from members; and

(iii) the members have voting privileges and representation on the governing board and committees.

(3)(A) A policy issued to a trust, or to one or more trustees of a fund established or adopted by:

(i) two or more employers;

(ii) one or more labor unions or similar employee organizations; or

(iii) one or more employers and one or more labor unions or similar employee organizations.

(B) A policy under this subdivision must be issued for the purpose of insuring employees of the employers or members of the unions or organizations for the benefit of persons other than the employers or the unions or organizations. The trust or trustee shall be deemed the policyholder.

(4) Under a policy issued to any other substantially similar group which, in the discretion of the Commissioner, may be subject to the issuance of a group accident and sickness policy or contract. (Amended 1989, No. 106, § 4, eff. Sept. 1, 1989; 1991, No. 52, § 2, eff. June 6, 1991; 2013, No. 79, § 1, eff. Oct. 1, 2013.)